Correlation Between Citi Trends and GCT Semiconductor
Can any of the company-specific risk be diversified away by investing in both Citi Trends and GCT Semiconductor at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Citi Trends and GCT Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citi Trends and GCT Semiconductor Holding, you can compare the effects of market volatilities on Citi Trends and GCT Semiconductor and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Citi Trends with a short position of GCT Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citi Trends and GCT Semiconductor.
Diversification Opportunities for Citi Trends and GCT Semiconductor
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Citi and GCT is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Citi Trends and GCT Semiconductor Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GCT Semiconductor Holding and Citi Trends is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Citi Trends are associated (or correlated) with GCT Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GCT Semiconductor Holding has no effect on the direction of Citi Trends i.e., Citi Trends and GCT Semiconductor go up and down completely randomly.
Pair Corralation between Citi Trends and GCT Semiconductor
Given the investment horizon of 90 days Citi Trends is expected to under-perform the GCT Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, Citi Trends is 14.91 times less risky than GCT Semiconductor. The stock trades about -0.01 of its potential returns per unit of risk. The GCT Semiconductor Holding is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,049 in GCT Semiconductor Holding on September 3, 2024 and sell it today you would lose (787.00) from holding GCT Semiconductor Holding or give up 75.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 37.05% |
| Values | Daily Returns |
Citi Trends vs. GCT Semiconductor Holding
Performance |
| Timeline |
| Citi Trends |
| GCT Semiconductor Holding |
Citi Trends and GCT Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citi Trends and GCT Semiconductor
The main advantage of trading using opposite Citi Trends and GCT Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citi Trends position performs unexpectedly, GCT Semiconductor can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in GCT Semiconductor will offset losses from the drop in GCT Semiconductor's long position.| Citi Trends vs. JJill Inc | Citi Trends vs. Zumiez Inc | Citi Trends vs. Tillys Inc | Citi Trends vs. Duluth Holdings |
| GCT Semiconductor vs. Silicon Motion Technology | GCT Semiconductor vs. ASE Industrial Holding | GCT Semiconductor vs. SemiLEDS | GCT Semiconductor vs. Advanced Micro Devices |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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